Overview
- Financial educator Simran Kaur maps targets of roughly one to two months of expenses in your 20s, about 1× salary by your 30s, 3× in your 40s, 6× in your 50s, and about 8× by your 60s, with Fidelity’s model pointing to 10× by age 67 if saving roughly 15% annually since 25 with a stock‑heavy mix.
- Sample pre‑retirement budgets emphasize large saving allocations, including a 40% essentials, 30% savings, 20% discretionary, 10% miscellaneous template and a 20%–25% savings share in a typical allocation from adviser David Blain.
- Experts stress consistent, above‑average saving, avoiding lifestyle inflation, paying off high‑interest debt, maximizing employer matches, and pairing tax‑advantaged accounts with taxable investments for earlier withdrawals.
- For under‑40 savers, compounding math is decisive: $10,000 plus $200 monthly at an 8% return grows to over $171,000 after 30 years and over $404,000 after 40 years, with 2025 401(k) contributions capped at $23,500 for those under 50.
- Risk management advice includes considering a withdrawal rate below the classic 4% rule, delaying Social Security up to age 70 for roughly an 8% annual benefit boost, maintaining about two years of expenses in cash, and diversifying the portfolio, including dividend payers.